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Valspar Inks Supply Deal with Ace Paint

Friday, January 4, 2013

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The Valspar Corp. has acquired Ace Hardware Corp.'s paint manufacturing assets, including two plants, and has entered into a long-term supply relationship with the global retailer.

Terms of the deal, announced Jan. 2, were undisclosed.

Under the agreement, Minneapolis-based paint and coatings maker Valspar will manufacture and supply Ace-branded paint products. Valspar will also sell a comprehensive line of its own branded paints at more than 4,000 Ace retail locations in the United States, the company said.

Another Believer / Wikimedia Commons

Ace Hardware will sell Ace- and Valspar-branded paint products—all to be manufactured by Valspar—in more than 4,000 stores in the United States.

Based in Oak Brook, IL, Ace Hardware is the largest retailer-owned cooperative in the convienence segment of the hardware industry, with annual retail sales of about $12 billion. The company was founded in 1924.

Its paint manufacturing assets, now owned by Valspar, include two facilities located near Chicago.

'Strategic Relationship'

“Our agreement with Ace extends the Valspar brand while further strengthening and diversifying Valspar’s portfolio of industry-leading consumer paints in the North American market,” said Valspar CEO Gary Hendrickson.

“This new business also positions Valspar well for further growth as the U.S. housing market continues to recover.”

Valspar Corp.

Ace Hardware says it has "ambitious goals" for its paint category and the new relationship with Valspar sets the company on the path for growth.

Billed as a "strategic relationship," the agreement combines Ace’s "in-store service model and neighborhood store footprint with Valspar’s national paint brand, manufacturing and distribution expertise, and technology," according to Valspar.

Enhancing Products, Goals

“We have ambitious goals for our paint category, and this step puts Ace on the path to growing market share in liquid paint and increasing revenue opportunities for all Ace retailers,” said Ace Hardware CEO Ray Griffith.

Valspar announced that it would immediately begin manufacturing and distributing Ace’s existing portfolio of its branded paint products.

Then, over the next year, Ace and Valspar will collaborate with retail owners to enhance their paint departments.

Introduction of Valspar paint products is expected to begin in the fall of 2013, Valspar said. Ace will retain ownership of its existing paint brand trademarks, including Clark+Kensington and Ace Paint, but Valspar will manufacture Ace’s product lines exclusively for the retailer.

Comment from Tom Schwerdt, (1/4/2013, 9:06 AM)

I'm surprised Ace was still making their own paint. Other major retail stores typically have someone else make their paint.